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Greek manufacturing sector growth sharpest in over ten years

Staff Writer | February 2, 2018
The Greek manufacturing sector hit the ground running during the first month of the year, with business conditions improving to the greatest extent in over ten years.
Greek manufacturing
Greece   IHS Markit Greece Manufacturing PMI
Growth was underpinned by strong client demand in both domestic and foreign markets.

This encouraged firms to add to their staffing numbers at the joint-sharpest rate in the survey history, in turn contributing to another marked rise in output.

Nonetheless, backlogs of work accumulated for the first time since June 2008.

Meanwhile, business confidence hit a new high.

The seasonally adjusted IHS Markit Greece Manufacturing Purchasing Managers’ Index (PMI ) – a composite indicator designed to measure the performance of the manufacturing economy – posted above the 50.0 no-change threshold in January.

Moreover, at 55.2, up from 53.1 in December, the index reading signalled the sharpest improvement in business conditions since October 2007.

The expansion was also the eighth in as many months, highlighting by far the longest sequence of expansion since 2008.

The rates of growth were broadly similar across the three monitored sub-sectors of consumer, intermediate and investment goods.

The overall expansion was driven by a steep rise in new orders, indeed the sharpest since October 2007.

Strong client demand was reported in both domestic and foreign markets, with export orders rising at the quickest pace in over ten-and-a-half years.

A strong demand environment encouraged firms to hire additional workers at the joint-quickest pace since the survey’s inception over 18-and-a-half years ago.

Backlogs of unfinished work accumulated nonetheless, ending a nine-and-a-half year period of depletion.

Meanwhile, manufacturers expanded their purchasing activity to the greatest extent since November 2007, which in turn, contributed to the first build-up of pre-production inventories since July 2008.

Enhanced operating capacity allowed firms to boost production during January, thereby extending the current period of expansion to eight months.

Moreover, the rate of growth was the steepest in over nine-and-a-half years.

In spite of this, firms continued to deplete their stocks of finished goods as they looked to meet high client demand.

These positive trends helped boost business confidence, which improved to a series record high in January amid expectations of increased investment and improving financial conditions.